BNSF Railway Of Warren Buffett Joins Blockchain Alliance

2/7/2018 1:57 AM ET

BNSF Railway, owned by Warren Buffet's Berkshire Hathaway, has joined the Blockchain in Transport Alliance (BiTA), a forum of 200 freight transportation companies aiming to develop blockchain standards and education for the freight industry.

BiTA members will examine ways to use the Blockchain, the technology behind Bitcoin and other cryptocurrencies, in the freight and logistics industry.

They will work together to set standards for what data goes into the freight transportation blockchain, structure and format of data, and cases where blockchain would be used.

The members of BiTA include German software firm SAP, shippers FedEx Corp and United Parcel Service Inc, as well as the logistic arm of China's e-commerce giant JD.com, among others.

Muru Murugappan, BNSF vice president of technology services and chief information officer, said, "Blockchain technology has the potential to change several aspects of the transportation industry and it is important that the industry comes together to align around a set of standards."

Blockchain functions as a distributed ledger, wherein all members of a particular blockchain have access to all the data within it. By housing information with each member, altering the information within a blockchain will require the approval of 51 percent of the blockchain's participants.

With the addition of Buffet's BNSF, which operates around 32,500 route miles of track in 28 states as well as in three Canadian provinces, BiTA hopes that other transportation companies will also follow suit.

Craig Fuller, managing director, BiTA, noted that BNSF's embracement of technology standards for the future of the industry will have a profound impact on the future of customer supply chains.

Legal firms, healthcare providers, retail and manufacturing industries have already adopted the distributed ledger technology that makes up the backbone of the Blockchain.

According to TechRepublic, the business value-add of blockchain is expected to grow to more than $176 billion by 2025, and to exceed $3.1 trillion by 2030.